In the early hours of the 19th, the UAE announced its decision to suspend all trade, commercial, and financial transactions with Iran. A former senior U.S. official stated that, given the UAE’s importance to Iran’s economy, this decision could have an even greater impact than the U.S. maritime blockade.
Retired U.S. Army Brigadier General and former Assistant Secretary of State Mark Kimmitt, in an interview with Al Jazeera, said that the significance of the UAE to Iran’s financial transactions and trade “cannot be overstated.” The UAE is Iran’s largest source of imports, with approximately one-third of Iran’s imported goods transiting through Dubai.
He added that as a financial center, Dubai has long provided channels for Iran to bypass international sanctions. In many ways, the UAE’s embargo may prove even more powerful than the U.S. port blockade imposed on Iran since mid-April.
This embargo decision may make Iran’s situation even more dire.
Kimmitt compared the UAE’s move to the U.S. comprehensive embargo on Japan during World War II, suggesting that Iran might view it as an act bordering on war.
When asked if other Gulf states would follow suit if they were attacked by Iran, Kimmitt predicted that other Gulf countries would remain cautious and observe the developments between Iran and the UAE.
Erickson, CEO of Obsidian Risk Consulting, said that as Iran’s second largest trading partner, the UAE’s action comes as the U.S. orchestrates “unprecedented economic isolation” against Iran. “The timing of these two events is simply too coincidental to ignore.”